Three basic tests: The enterprise sustained truly spectacular results for an era of 15+ years relative to the general stock market and relative to its industry. The enterprise achieved these results in a particularly turbulent environment, full of events that were uncontrollable, fast-moving, uncertain, and potentially harmful. The enterprise began its rise to greatness from a position of vulnerability, being young and/or small at the start of its 10X journey.
Successful leaders in a turbulent world are bold, risk-seeking visionaries Innovation distinguishes 10X companies in a fast-moving, uncertain and chaotic world A threat-filled world favours the speedy; you are either the quick or the dead Radical change on the outside requires radical change on the inside Great enterprises with 10X success have a lot more good luck But 10Xers havn’t
They’re not more creative They’re not more visionary They’re not more charismatic They’re not more ambitious They’re not more blessed by luck They’re not more risk seeking They’re not more heroic They’re not more prone to making big, bold moves
Productive Paranoia 1: Build cash reserves and buffers – oxygen canisters –to prepare for unexpected events and bad luck before they happen. Southwest Airline = สำรองเงินไว้ ทำให้ไม่ขาดทุน ไม่ ลดเที่ยวบิน หลังเกิด 11/9 Productive Paranoia 2: Bounding risk: – Death Line risk, asymmetric risk, and uncontrollable risk – and manage time- based risk.
Productive Paranoia 3: Zoom out, then zoom in, remaining hyper-vigilant to sense changing conditions and respond effectively Zoom Out Sense a change in conditions. Assess the time frame: How much time before the risk profile changes? Assess with rigor: Do the new conditions call for disrupting plans? If so, how? Zoom In Focus on supreme execution of plans and objectives.
10Xers channel their ego and intensity into something larger and more enduring than themselves. They’re ambitious, for a purpose beyond themselves, Be it building a great company, Changing the world, or Achieving some great object that’s ultimately not about them.
Ex. Microsoft 1985-1997, south west airline There are two healthy approaches to amending the SMaC recipe: 1. Exercising empirical creativity, which is more internally driven, and 2. Exercising productive paranoia, which is more externally focused. The first involves firing bullets to discover and test a new practice before making it part of the recipe. The second employs the discipline to zoom out to perceive and assess a change in conditions, then to zoom in to implement amendments as needed.